Title
De la Cruz, Jr. vs. National Labor Relations Commission
Case
G.R. No. 145417
Decision Date
Dec 11, 2003
Employee dismissed for dishonesty after unauthorized reimbursement of family plane tickets; Court upheld termination, denying backwages and damages due to just cause.
senior sales manager
company standards
illegal dismissal case

Case Summary (G.R. No. L-45911)

Employment and Grounds for Termination

Shemberg hired petitioner on May 27, 1996 for a monthly salary of P40,500. The position of Senior Sales Manager was newly created to support Shemberg’s market product positioning objective. Petitioner’s functions included supervising and controlling the company’s sales force, exercising limited discretion in appointing district sales representatives, and reshuffling salesmen to achieve sales targets.

On September 14, 1996, Shemberg’s human resource manager, Ms. Lilybeth Y. Llanto, summoned petitioner and informed him that management had decided to terminate his services. When petitioner asked for the reason, Llanto gave a general explanation that it related to the decline in company sales. Petitioner then requested a meeting with Shemberg’s vice president, Ernesto U. Dacay, Jr., but was informed that management’s decision was final. Petitioner also requested a thirty-day written notice, but management denied the request.

The Complaint and Respondents’ Theory of Dismissal

Petitioner filed a complaint for illegal dismissal and related money claims including unpaid wages, backwages, thirteenth month pay, and damages, against Shemberg, Ernesto Dacay, Jr., and Lilybeth Llanto. Respondents denied illegal dismissal and asserted that petitioner’s termination was based on four categories of alleged misconduct or deficiencies: (one) poor performance shown by a steady and substantial drop in company sales after he assumed the Senior Sales Manager role; (two) dissatisfaction of subordinates with his management style and dealings with company distributors, resulting in low morale, supported by a joint affidavit of two subordinates, Ruel O. Salgado and Joel D. Sol; (three) unauthorized use of a company cellular phone for overseas personal calls; and (four) unauthorized reimbursement of plane tickets of his wife and child. Respondents summarized the dismissal as justified by petitioner’s failure to meet company standards and loss of trust and confidence.

First Labor Arbiter Ruling

In a decision dated August 25, 1997, Labor Arbiter Ernesto F. Carreon ruled that petitioner was illegally dismissed. He awarded petitioner separation pay, backwages, and unpaid wages, and dismissed the other claims and the case against Dacay and Llanto for lack of merit. The award ordered Shemberg to pay: P40,500 as separation pay, P379,350 as backwages, and P18,900 as unpaid wages, for a total of P438,750.

NLRC Appeal and Subsequent Motion for Reconsideration

On appeal, the NLRC issued a decision dated May 13, 1998 dismissing respondents’ appeal. Respondents filed a motion for reconsideration and submitted additional documentary evidence, namely: (1) an affidavit dated July 11, 1998 executed by Ms. Lily Joy M. Sembrano, Shemberg’s vice president for operations; (2) petitioner’s letter of appointment dated July 8, 1996 as Senior Sales Manager; (3) petitioner’s job description; (4) a memorandum dated July 30, 1996 warning petitioner about the huge drop in company sales; and (5) an undated memorandum requiring petitioner to explain his claim for reimbursement of his wife’s and child’s plane tickets.

Petitioner opposed the motion and challenged the authenticity of the additional evidence. The NLRC, however, partially granted the motion for reconsideration in a resolution dated July 9, 1999. It abandoned the May 13, 1998 decision and modified the Labor Arbiter’s August 25, 1997 decision. The NLRC set aside the prior award and ordered Shemberg to pay petitioner only P23,900, broken down into P18,900 unpaid wages and P5,000 as indemnity, and it denied the other monetary components previously granted.

Petitioner moved for reconsideration of the July 9, 1999 resolution, but the NLRC denied it in a resolution dated November 19, 1999. Petitioner then went to the Court of Appeals via certiorari, but the petition was dismissed for lack of merit, and his subsequent motion for reconsideration was denied on September 8, 2000, prompting the present petition.

Issues Raised by Petitioner

Petitioner assigned as errors that the Court of Appeals: first, refused to award backwages despite a factual finding that respondents failed to comply with the two-notice requirement, contrary to the doctrine in “Serrano vs. NLRC and Isetann Dept. Store, G.R. No. 117040, 27 January 2000.” Second, allegedly gravely abused discretion by ruling that petitioner’s submission of his family’s plane tickets for reimbursement constituted unauthorized use of company funds, despite the absence of a specific prohibition and considering that respondents raised the matter only on appeal as an afterthought. Third, it failed to award damages and attorney’s fees.

Court’s Treatment of Dismissal Justification and Factual Findings

In addressing petitioner’s contentions, the Court emphasized that the decisive question involved whether the dismissal was for a just cause and whether the NLRC and the Court of Appeals correctly assessed the evidence supporting loss of trust and confidence. The Court reiterated the general rule that findings of fact of the Court of Appeals are conclusive and are not ordinarily reviewable on certiorari when supported by substantial evidence, since the Supreme Court is not a trier of facts and relies on the lower courts’ evaluation of evidence.

The Court adopted the Court of Appeals’ factual findings affirming the NLRC decision insofar as dismissal was concerned. It specifically sustained the conclusion that petitioner’s dismissal found basis in the unauthorized reimbursement of plane ticket fares, while the evidence regarding cellular phone calls was inadequate to establish petitioner’s direct commission of unauthorized overseas calling.

Evidence on Cellular Phone Use and Plane Ticket Reimbursement

The Court of Appeals found that there was substantial evidence that petitioner was guilty of unauthorized use of company funds only with respect to the reimbursement of plane tickets. On the cellular phone issue, the Court of Appeals held that the cellular phone bill statement showing alleged unauthorized overseas calls did not prove that petitioner actually made those calls. It noted that petitioner claimed the mobile unit was not always used by him, and respondents did not controvert that claim. It further observed that there was no evidence on whether the recipient of the overseas calls was not connected with company business, and that the mere presentation of a cellular phone bill statement would not suffice to charge unauthorized use—especially in light of a cellular company memorandum warning subscribers about illegal activities by unauthorized individuals posing as employees.

With respect to plane tickets, the Court of Appeals reasoned that petitioner’s reimbursement was unjustified and fell within the category of betrayal of trust. It observed that respondents insisted petitioner submitted tickets of his wife and child and reimbursed them using corporate funds without management authority or permission. Petitioner denied having reimbursed the costs or having used company funds to purchase the tickets. Yet the Court of Appeals found petitioner’s denial unavailing due to the actual presentation of the plane tickets in petitioner’s name and those of his family, together with terminal fee stubs carrying three different serial numbers but similarly dated. It concluded that the corporation’s possession of the plane tickets necessarily indicated they were submitted to management for reimbursement along with other transportation expenses. It also held that petitioner did not explain why the tickets were in the corporation’s possession, and that his denials, without supporting proof and given his silence, could not prevail.

Rejection of “Afterthought” Argument and Admission of Evidence on Appeal

Petitioner argued that the alleged plane-ticket reimbursement issue was a mere afterthought because respondents allegedly had not raised it in the original position papers before the labor arbiter. The Court of Appeals rejected that contention. It held that the NLRC acted correctly in considering the matter because labor proceedings are governed by Article 221 of the Labor Code, which provides that technical rules of evidence in courts of law or equity are not controlling and that labor tribunals use reasonable means to ascertain facts speedily and objectively, without regard to technicalities of law or procedure in the interest of due process.

In support of this approach, the Court cited jurisprudence where it upheld the NLRC’s consideration of additional documentary evidence presented on appeal to prove breach of trust and loss of confidence. It referred to Bristol Laboratories Employees’ Association vs. NLRC and Lopez vs. NLRC, as illustrations that documents may be admitted in labor cases even when presented only on appeal, because technicalities should not obstruct equitable and complete resolution of parties’ rights and obligations.

Probationary Employment and the Standard for Regularization

Petitioner also contended that he was not a probationary employee because Shemberg allegedly failed to disclose the reasonable standards for qualifying as a regular employee. The Court addressed this contention by analyzing petitioner’s appointment paper and attached job description. It found that petitioner was informed that his performance would be periodically evaluated in accordance with company performance standards, and that he would report to the President while maintaining coordinating relationships with specified divisions and plant managers.

The Court further treated petitioner’s job description as containing the relevant probationary notice by expressly stating that performance was subject to evaluation and a trial period for six (6) months or more. It then restated the legal concept of probationary employment: the employer observes and evaluates the employee’s skill, competence, and attitude, while the employee seeks to meet reasonable standards f

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